Planning Expenses When developing the tactical profit plan, the expenses for each responsibility center should be carefully assessed. In harmony with the concept of participation, expense planning should involve all levels of management. Participation is essential in developing realistic expense budgets foe each responsibility center. In planning expenses for a responsibility center, the output or activity for that center must be planne. For example, to develop an expense plan for the power department, the expected demands for power first must be planned. An expenditure plan for research and development must be related to the type and extent of research activities planned. Thus, we see that all expense planning should be based on planned outputs.